Tag Archives: finance

The University of Minnesota has already scaled back its initial plans for new athletic facilities, but many are pushing for construction to begin within the next two months. The (current) initial phase is estimated to cost $150 million.

The U has reported private contributions of approximately $70 million, but much of that amount is only pledged, with agreed-upon cash payments to be made over the next decade.

It appears that the Athletic Department will need to take on more debt in order to move the project forward in the near future. So, what has the U’s debt load looked like as compared to its Big Ten peers in the past and how might things look in the future? Today, we look to answer those questions.

The Star Tribune (link to their article is at the bottom of this article) recently said, “Kill is being paid an average of $2.3 million a year on his current salary and is one of the lowest-paid coaches in the country at a major program.”

This isn’t even close to true. The Star Tribune’s claim is completely baseless and false.

Star Tribune: “For example, look at Iowa’s Kirk Ferentz. He signed a 10-year contract in 2010 extension that paid him approximately $4 million this season. If he were to stay on through the end of his contract in 2020, he is due an additional $21 million.”

The Ferentz contract is about the most absurd single example one could come up when trying to argue that Kill is one of the lowest-paid coaches in the country at a major program.

“[A]ccording to a source with direct knowledge of the deal, [Marquette] would have been paying him [Buzz Williams] in excess of $4 million within the next two seasons. That is football coach money at a school with a major commitment to being good at basketball. If all of that sounds weird, that’s because it is.” — Sports Illustrated

A week ago we walked through some specifics on the contract between Buzz Williams and Virginia Tech. The traditional media might continue to dream up a fact pattern that concludes Buzz Williams took a gigantic pay cut to get out of Milwaukee. Reality doesn’t support such a claim.

Just this month, Marquette filed their annual Form 990 for the year ended June 30, 2013. Late Night Hoops compared their reporting of Buzz Williams’ pay each year over the past several years. The trends illustrated in this article give rise to the possibility that pay might have been a source of frustration for Williams.

In the past we have brought up the inaccurate claims that were on Minnesota AD Norwood Teague’s bio, specifically around a new basketball practice facility at VCU. Teague came to the Twin Cities from VCU and was touted as a big time fundraiser. Many believed (and still do) that he had constructed a basketball practice facility in Richmond, but he had only suggested a facility be built for around $10 million with private funds. That amount quickly grew to an estimated $14.5 million.

Fast forward to earlier this month and finally real plans have been set in motion for the Rams basketball program. The plans now look quite a bit different than they did in 2011:

The project’s estimated cost has risen to $25 million. VCU says a significant factor in the increase is that when new AD Ed McLaughlin arrived in 2012, he determined the current plans wouldn’t work from a Title IX perspective. A new, larger location that could better accommodate both the men and women was needed.

Private funding wasn’t going to get the job done. The school announced they would reallocate student fees to help pay for the project. There has been clamoring from some students, but after another strong season (until last night’s loss) support for VCU basketball is very high.

Per review of a draft of the Executive Committee’s minutes from earlier this month, VCU’s board has approved entering into a line of credit agreement to front the money needed for construction. This should enable the project to get started (shovels in the ground) this spring, with completion possible before the start of classes in fall 2015.

Last summer Norwood Teague announced his idea of a $190 million facilities plan for the University of Minnesota. We found the idea to be borderline absurd [See: Minnesota’s Facilities Plan Set Up For Failure – July 10, 2013] and still do. Things have been quiet since last summer, but we understand a “fundraising feasibility study” has been “wrapping up”.